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MoviePass owner Helios and Matheson could see its shares fall if it’s delisted

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MoviePass CEO Mitch Lowe and Helios and Matheson Chief Executive Ted Farnsworth.Mitch Lowe, CEO of MoviePass, and Ted Farnsworth, CEO of parent company Helios and Matheson, in happier times. The latter company could see its stock delisted by the Nasdaq within days.MoviePass/Reuters
  • MoviePass’s parent company, Helios and Matheson, is in danger of having its stock delisted by the Nasdaq within weeks. 
  • The company has failed to meet a key listing standard — its shares have traded below $1 a share for most of the last seven months. 
  • If Nasdaq delisted the stock, it would trade in the over-the-counter markets.
  • That could lead the stock to fall even farther in value and could make it hard for investors and the company to sell shares.
  • Helios and Matheson could delay the delisting by appealing it or getting a six-month extension to boost its stock.

As bad as this year has been for shareholders of Helios and Matheson, the parent company of MoviePass, things could soon get even worse.

The company’s stock is in danger of being delisted by the Nasdaq national market, potentially as soon as December 28. If and when that happens, its stock could plunge even farther than it already has, and shareholders could have a tough time selling their shares.

Worse, the company could find it difficult to raise new funds by selling additional shares — the chief way it’s kept itself in business this year amid mounting losses. 

“The delisting itself is clearly bad news,” said James Angel, an associate professor of finance at Georgetown University’s McDonough School of Business. 

Representatives of Helios and Matheson did not respond to an email seeking comment about the potential delisting.

Helios and Matheson has been trading below $1 a share

Helios and Matheson shareholders have already absorbed a bunch of bad news this year. MoviePass’ $10-a-month subscription service, which initially excited investors and boosted the company’s stock, proved to be a boondoggle. In just the first nine months of this year, Helios and Matheson has burned through $321 million in cash from its operations alone, almost entirely due to MoviePass. It’s kept afloat by issuing and selling billions of new shares to the public, in the process massively diluting its investor base — and sinking its stock price. 

The Nasdaq requires that all listed companies and their stocks meet certain requirements, among them that they trade over $1 a share. Thanks to Helios and Matheson’s massive stock sales, its shares fell below that threshold in May and, with a brief respite after a reverse split in July, have stayed below it since. The company repeatedly warned investors that Nasdaq had given it until this past Tuesday to get back into compliance. 

On Wednesday, according to a document Helios and Matheson filed Friday with the Securities and Exchange Commission, the Nasdaq warned the company it would suspend trading in its stock on December 28 and would move to delist it. Helios and Matheson said it would appeal the decision, which would put the delisting process on hold until the Nasdaq hears its appeal, and could potentially avert the stock’s removal if the company wins. 

But its prospects of prevailing in the appeal, which is slated to be held within 45 days of the company officially filing for one, look dubious. The Nasdaq already denied the company a second 180-day period to get its stock above $1 a share. The market’s staff said they didn’t think it was possible for Helios and Matheson to do that. 

Read this: MoviePass’s parent company is in dire danger of having its stock delisted by the Nasdaq

That would leave the company’s stock trading in the over-the-counter markets. Although investors could still buy and still shares, such a move could prove disastrous for the company.

“Very few companies come back from delisting,” said Kevin Mak, director of the real-time analysis and investment lab at Stanford’s Graduate School of Business. 

Its stock could take a further hit if it gets delisted

Companies that get delisted from major exchanges often see an immediate drop in their stock value, market experts said. With its stock trading lately at less than 2 cents a share, it might seem that Helios and Matheson has nowhere left to fall. But some stocks in the over-the-counter markets are trading for as little as 0.01 cents a share, Angel noted, so it could have plenty of room left to fall. 

Part of the reason why stocks that are delisted see an immediate share price decline is that many institutional investors aren’t permitted to own stocks that aren’t on the major exchanges, said Mak. If the Nasdaq does drop Helios and Matheson’s stock, it could force mutual funds, pension funds and other big investors that still hold its shares to dump their investments, he said. 

“It’s generally going to be something that’s going to cause them to sell,” he said. 

Another problem for companies whose stocks trade over the counter — and their investors — is that their shares can be harder to buy and sell. It’s not just that many institutional investors can’t trade such stocks, it’s that many individual investors avoid over-the-counter markets as well. Because stocks that trade over-the-counter aren’t subject to any exchange’s listing requirements and have often ended up there because they don’t meet those requirements, they’re generally considered to be riskier investments.

Investors can still generally trade relatively small quantities of shares in the over-the-counter markets without too much trouble, the market experts said. But it can be much more difficult to buy and sell mass quantities, they said. 

“You’re less likely to find a counterparty if you want to trade,” said Christine Parlour, a finance professor at the Haas School of Business at the University of California, Berkeley. 

Helios and Matheson has depended on selling shares

Relatedly, the costs of trades made in the over-the-counter markets tend to be significantly higher than in the big national markets. The difference between the bid and ask prices for stocks listed on the big national markets tend to be a few pennies, or a small percentage of their share prices. The gap tends to be much bigger for over-the-counter stocks. 

What that means is that buyers tend to have to pay more for shares than they would otherwise, and sellers tend to have to sell them for considerably less. 

Such consequences of delisting could be particularly problematic for Helios and Matheson. The company had just $4.9 million in cash at the end of September, and burned through more than $100 million in cash in the third quarter despite trying numerous times to revamp its service to stanch its losses. 

Typically if companies to fail to meet a listing standard after the 180-day period the Nasdaq gives them to come back into compliance, the market will send them a letter warning them they the don’t meet the standard. Companies generally have four days to disclose such letters to shareholders. 

The Nasdaq is able to offer companies a second 180-day period to get back into compliance with its listing standards. But it typically offers that extension only to companies that meet all of its other requirements except the one they’ve been notified about.

The company does have a strategy to avoid being delisted

In addition to having its stock fall below the $1 threshold, Helios and Matheson has failed since August to meet another key standard — having a board composed of a majority of independent directors and an audit committee composed of at least three independent directors.

However, the company has nominated attorney Joseph Fried to serve as a director. Should he be elected at the company’s meeting later this month, he would bring Helios and Matheson back into compliance on those board requirements. 

The company has been planning to try to get back into compliance with the $1 a share listing requirement by reverse splitting its stock, in effect trading one new share for two to hundreds of older shares. But it cancelled a planned shareholder vote on a potential reverse-split plan last month in the face of widespread shareholder opposition.

Helios and Matheson already reverse-split its stock once this year, in July. The company’s stock stayed above $1 a share for less than a week, though, falling dramatically as the company resumed issuing and selling massive numbers of new shares

In its regulatory document warning of the Nasdaq’s delisting decision, Helios and Matheson said if the market gave it more time to get its stock above $1 a share, it would try again to get approval for a reverse split. It also said it would “continue considering all available options to resolve the company’s noncompliance” with the standard.

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Trudeau Government Should Turn to Sustainable Floor Heating In Its New Deal

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A consortium has been chosen by Public Services and Procurement Canada (PSPC) to manage the $1.1-billion overhaul of five heating and cooling plants in the National Capital Region. However, this decision has been met with a lot of disapproval by the country’s largest federal public service union.

Early June, the department announced that Innovate Energy has been awarded the 30-year contract “to design, retrofit, maintain and operate the plants,”winning the bid over a rival group that included SNC-Lavalin.

Minister of Environment, Catherine McKenna, said the federal government was “leading by example” in its bid to drastically reduce the amount of greenhouse gas emissions across the country. McKenna noted that by supporting this project, they’re utilizing heating and cooling infrastructure to promote a more environmentally friendly option.

“We’re very proud that our government is working with partners like Innovate Energy to modernize this critical infrastructure,” she said during the announcement at one of the facilities that will be upgraded, the Cliff Heating and Cooling Plant in downtown Ottawa.

The plants would be known as the district energy system and would heat 80 buildings in the area with steam. It is also expected to cool 67 of these buildings with chilled water through more than 14 kilometres of underground pipes.

Under the Energy Services Acquisition Program, PSPC will be tasked with modernizing the outdated technology in the plants to lower emissions and supportgrowth in the eco-friendly technology sector.

During the first stage of the overhaul, the system would be converted from steam to low temperature hot water and then switched from steam to electric chillers—with the estimated completion date being 2025. PSPC notes that the project will reduce current emissions by 63 per cent, the equivalent of removing 14,000 non-eco-friendly cars off the road.

Afterwards, the natural gas powering the plant will then be replaced by carbon-neutral fuel sources, which according to estimated will reduce emissions by a further 28 per cent. The renovation project is bound to save the government an estimated fee of more than $750 million in heating and cooling costs in the next 40 years.

Furthermore, the implementation of radiant floor heating in Ottawa by the federal government would be an additional step in driving its agenda for a more eco-friendly state.

According to the U.S. Department of Energy’s Energy Savers website, radiant floor heating has a lot of benefits and advantages over alternate heat systems and can cut heating costs by 25 to 50 per cent.

“It is more efficient than baseboard heating and usually more efficient than forced-air heating because no energy is lost through ducts,” the website states.

Radiant floor heating provides an equal amount of heat throughout a building, including areas that are difficult to heat, such as rooms with vaulted ceilings, garages or bathrooms. Consideringit warms people and objects directly—controlling the direct heat loss of the occupant—radiant floor heating provides comfort at lower thermostat settings.

“Radiators and other forms of ‘point’ heating circulate heat inefficiently and hence need to run for longer periods to obtain comfort levels,” reports the Residential Energy Services Network (RESNet).

Radiant heating is a clean and healthy option—a perfect choice for those with severe allergies—as it doesn’t rely on circulating air, meaning there are no potentially irritating particles blowing around the room. Additionally, it is more energy efficient, aesthetically pleasing with wall radiators or floor registers and virtually noiseless when in operation.

“They draw cold air across the floor and send warm air up to the ceiling, where it then falls, heating the room from the top down, creating drafts and circulating dust and allergens.”

It is important for the leadership in Ottawa to equally drive the adoption of radiant floor heating as doing this would lead to increased usage in residential buildings—and even government-owned buildings.

However, in October, the Public Service Alliance of Canada (PSAC), a representative body of employees of the plants,began a campaign target at the government against their decision to use a public-private partnership (P3) for the retrofitting project, citing concerns about costs and safety.

According to the union, outside employees won’t be bound to the same health and safety standards of government workers and that typically P3 projects cost a lot more than traditional public financing deals.

The union demands that the government scraps the proposed project and meet PSAC members and experts to brainstorm on a new way forward that would ensure federal employees continue to operate and maintain the plants.

However, parliamentary secretary to public services and procurement minister, Steve MacKinnon said that the union officials have consulted him but that after conducting an analysis, the P3 option was still the best for the job.

“We didn’t have (to) sacrifice on safety or health — we didn’t have to sacrifice on job security,” he said.

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Steps to becoming a Data Scientist

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Data science has become one of the most in-demand career paths in this century, according to Business Insider. With the amount of information being circulated online, it has created a huge demand for storing, interpreting and implementing big data for different purposes—hence the need for a data scientist.

Today, there too much information flying around for regular people to process efficiently and use. Therefore, it has become the responsibility of data scientists to collect, organize and analyze this data. Doing this helps various people, organizations, enterprise businesses and governments to manage, store and interpret this data for different purposes.

Though data scientists come from different educational backgrounds, a majority of them need to have a technical educational background. To pursue a career in data science, computer-related majors, graduations and post graduations in maths and statistics are quite useful.

Therefore, the steps to becoming a data scientist are quite straightforward.  After obtaining a bachelor’s degree in an IT related field—such as computer science, maths or physics—you can also further your education by obtaining a master’s degree in a data science or any other related field of study. With the necessary educational background, you can now search for a job and obtain the required experience in whichever filed you choose to invest your acquired skills.

Here are the necessary steps to be taken to become a data scientist.

Step 1: Obtain the necessary educational requirements

As earlier noted, different educational paths can still lead to a career in data science. However, it is impossible to begin a career in data science without obtaining a collegiate degree—as a four-year bachelor’s degree is really important. However, according to a report by Business Insider, over 73% of data scientist in existence today have a graduate degree and about 38% of them hold a Ph.D. Therefore, to rise above the crowd and get a high-end position in the field of data science, it is important to have a Master’s degree or a Ph.D.—and with various online data science masters program, obtaining one is quite easy.

Some institutions provide data science programs with courses that will equip students to analyze complex sets of data. These courses also involve a host of technical information about computers, statistics, data analysis techniques and many more. Completing these programs equips you with the necessary skills to function adequately as a data scientist.

Additionally, there are some technical—and computer-based degrees—that can aid you begin a career in data science. Some of them include studies in, Computer Science, Statistics, Social Science, Physics, Economics, Mathematics and Applied Math. These degrees will imbibe some important skills related to data science in you—namely, coding, experimenting, managing large amounts of data, solving quantitative problems and many others.

Step 2: Choose an area of specialization

There rarely exists an organization, agency or business today that doesn’t require the expertise of a data scientist. Hence, it is important that after acquiring the necessary education to start a career as a data scientist, you need to choose an area of specialization in the field you wish to work in.

Some of the specializations that exist in data science today include automotive, marketing, business, defence, sales, negotiation, insurance and many others.

Step 3: Kick start your career as a data scientist

After acquiring the necessary skills to become a data scientist, it is important to get a job in the filed and company of your choice where you can acquire some experience.

Many organizations offer valuable training to their data scientists and these pieces of training are typically centred around the specific internal systems and programs of an organization. Partaking in this training allows you learn some high-level analytical skills that were not taught during your various school programs—especially since data science is a constantly evolving field.

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Artificial intelligence pioneers win tech’s ‘Nobel Prize’

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Computers have become so smart during the past 20 years that people don’t think twice about chatting with digital assistants like Alexa and Siri or seeing their friends automatically tagged in Facebook pictures.

But making those quantum leaps from science fiction to reality required hard work from computer scientists like Yoshua Bengio, Geoffrey Hinton and Yann LeCun. The trio tapped into their own brainpower to make it possible for machines to learn like humans, a breakthrough now commonly known as “artificial intelligence,” or AI.

Their insights and persistence were rewarded Wednesday with the Turing Award, an honor that has become known as technology industry’s version of the Nobel Prize. It comes with a $1 million prize funded by Google, a company where AI has become part of its DNA.

The award marks the latest recognition of the instrumental role that artificial intelligence will likely play in redefining the relationship between humanity and technology in the decades ahead.

Artificial intelligence is now one of the fastest-growing areas in all of science and one of the most talked-about topics in society,” said Cherri Pancake, president of the Association for Computing Machinery, the group behind the Turing Award.

Although they have known each other for than 30 years, Bengio, Hinton and LeCun have mostly worked separately on technology known as neural networks. These are the electronic engines that power tasks such as facial and speech recognition, areas where computers have made enormous strides over the past decade. Such neural networks also are a critical component of robotic systems that are automating a wide range of other human activity, including driving.

Their belief in the power of neural networks was once mocked by their peers, Hinton said. No more. He now works at Google as a vice president and senior fellow while LeCun is chief AI scientist at Facebook. Bengio remains immersed in academia as a University of Montreal professor in addition to serving as scientific director at the Artificial Intelligence Institute in Quebec.

“For a long time, people thought what the three of us were doing was nonsense,” Hinton said in an interview with The Associated Press. “They thought we were very misguided and what we were doing was a very surprising thing for apparently intelligent people to waste their time on. My message to young researchers is, don’t be put off if everyone tells you what are doing is silly.” Now, some people are worried that the results of the researchers’ efforts might spiral out of control.

While the AI revolution is raising hopes that computers will make most people’s lives more convenient and enjoyable, it’s also stoking fears that humanity eventually will be living at the mercy of machines.

Bengio, Hinton and LeCun share some of those concerns especially the doomsday scenarios that envision AI technology developed into weapons systems that wipe out humanity.

But they are far more optimistic about the other prospects of AI empowering computers to deliver more accurate warnings about floods and earthquakes, for instance, or detecting health risks, such as cancer and heart attacks, far earlier than human doctors.

“One thing is very clear, the techniques that we developed can be used for an enormous amount of good affecting hundreds of millions of people,” Hinton said.

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